HomeMy WebLinkAbout07-17 Kaleidoscope_FINAL_RESOLUTIONExtract of Minutes of a Meeting of the City Council of the City of Falcon Heights, Minnesota
Pursuant to due call and notice thereof, a regular meeting of the City Council of the City of Falcon Heights, Minnesota (the "City"), was duly held at the City Hall in said City on Wednesday,
the 26th day of September, 2007, at 7:00 o'clock p.m.
The following members were present: Mayor Sue Gehrz, Pam Harris, Laura Kuettel, Peter Lindstrom and Rick Talbot, and none were absent.
Member Rick Talbot introduced the following resolution and moved its adoption:
RESOLUTION 2007-17 AUTHORIZING THE ISSUANCE OF LEASE REVENUE BONDS TO FINANCE A PUBLIC (CHARTER) SCHOOL PROJECT PURSUANT TO MINNESOTA LAW, AND AUTHORIZING THE EXECUTION OF VARIOUS DOCUMENTS
IN CONNECTION THEREWITH (KALEIDOSCOPE CHARTER SCHOOL PROJECT)
After full discussion thereof and upon vote being taken thereon, the following voted in favor thereof: Mayor Sue Gehrz, Pam Harris, Laura Kuettel, Peter Lindstrom and Rick Talbot and
the none voted against the same, whereupon said resolution was declared duly passed and adopted.
RESOLUTION 2007-17 AUTHORIZING THE ISSUANCE OF LEASE REVENUE BONDS TO FINANCE A PUBLIC (CHARTER) SCHOOL PROJECT PURSUANT TO MINNESOTA LAW, AND AUTHORIZING THE EXECUTION OF VARIOUS DOCUMENTS
IN CONNECTION THEREWITH (KALEIDOSCOPE CHARTER SCHOOL PROJECT)
Authority. The City is, by the Constitution and laws of the State of Minnesota, including Minnesota Statutes, Sections 469.152 to 469.1651, as amended (the "Act"), authorized to issue
and sell its revenue bonds for the purpose of financing industrial development within the community and surrounding areas and to enter into agreements necessary or convenient in the
exercise of the powers granted by the Act.
Authorization of Project; Documents Presented. KCS Building Company (the "Company"), a Minnesota nonprofit corporation and an organization described under Section 501(c)(3) of the Internal
Revenue Code of 1986, as amended, has proposed that the City of Falcon Heights, Minnesota (the "City") issue and sell its Lease Revenue Bonds (Kaleidoscope Charter School Project) Series
2007A (the "Series A Bonds") and its Taxable Lease Revenue Bonds (Kaleidoscope Charter School Project) Series 2007B (the "Series B Bonds," and together with the Series A Bonds, the "Bonds")
in an aggregate amount not to exceed $9,000,000, in substantially the form set forth in the hereinafter mentioned Indenture, pursuant to the Act and loan the proceeds thereof to the
Company, in order to finance the acquisition, construction and equipping of an approximately 40,000 square foot public elementary schoolhouse to be located on Kolland Avenue west of
County Road 19 in the City of Otsego (the "Project") to be owned by the Company and leased to Kaleidoscope Charter School, a Minnesota nonprofit corporation and an organization described
under Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, (the "School"). Forms of the following documents relating to the Bonds have been submitted to the City:
Loan Agreement (the "Loan Agreement") between the City and the Company, whereby the City agrees to make a loan to the Company of the gross proceeds of sale of the Bonds and the Company
agrees to operate the Project and to pay amounts in repayment of the loan sufficient to provide for the full and prompt payment of the principal of, premium, if any, and interest on
the Bonds; and
Indenture of Trust (the "Indenture") between the City and Wells Fargo Bank, National Association, as trustee (the "Trustee"), authorizing the issuance of and pledging certain revenues,
including those to be derived from the Loan Agreement, as security for the Bonds, and setting forth proposed recitals, covenants and agreements relating thereto; and
Mortgage, Security Agreement and Assignment of Rents (the "Mortgage"), from the Company to the Trustee, by which the Company grants a mortgage lien on and security interest in certain
mortgaged property, as described therein, as further security for the payment of the Bonds and assigns its interests in all rents with respect to the mortgaged property;
Tax Regulatory Agreement (the "Tax Regulatory Agreement") by and among the City, the Company, the School and the Trustee;
Bond Purchase Agreement (the "Bond Purchase Agreement"), by and between Dougherty & Company LLC (the "Underwriter"), the Company, the School and the City, providing for the purchase
of the Bonds from the City by the Underwriter and setting the terms and conditions of purchase; and
Official Statement, which, including all Appendices thereto, is intended to constitute the form of the final Official Statement (the "Official Statement"), describing the offering of
the Bonds, and certain terms and provisions of the foregoing documents.
Findings. It is hereby found, determined and declared that:
The Project constitutes a Project authorized by and described in the Act.
On the basis of information available to the City it appears, and the City hereby finds, that the Project constitutes properties, real and personal, used or useful in connection with
one or more revenue producing enterprises engaged in any business within the meaning of Subdivision 2(b) of Section 469.153 of the Act; that the Project furthers the purposes stated
in Minnesota Statutes, Section 469.152; that the availability of the financing under the Act and willingness of the City to furnish such financing will be substantial inducement to the
Company to undertake the Project, and that the effect of the Project, if undertaken, will be to encourage the development of economically sound industry and commerce, to assist in the
prevention of the emergence of blighted and marginal land, to help prevent chronic unemployment, to provide the range of service and employment opportunities required by the population,
and to help prevent the movement of talented and educated persons out of the state and to areas within the state where their services may be as effectively used.
There is no litigation pending or, to the best of its knowledge, threatened against the City relating to the Bonds, the Loan Agreement, the Bond Purchase Agreement or the Indenture or
questioning the due organization of the City, or the powers or authority of the City to issue the Bonds and undertake the transactions contemplated hereby.
The execution, delivery and performance of the City's obligations under the Bonds, the Indenture, the Bond Purchase Agreement and the Loan Agreement do not and will not violate any order
of any court or other agency of government of which the City is aware or in which the City is a party, or any indenture, agreement or other instrument to which the City is a party or
by which it or any of its property is bound, or be in conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any such indenture,
agreement or other instrument.
It is desirable that the Bonds be issued by the City upon the terms set forth in the Indenture, under the provisions of which the City's interest in the Loan Agreement will be pledged
to the Trustee as security for the payment of principal of, premium, if any, and interest on the Bonds.
The Loan Agreement provides for payments by the Company to the Trustee for the account of the City of such amounts as will be sufficient to pay the principal of, premium, if any, and
interest on the Bonds when due. The Loan Agreement obligates the Company to pay for all costs of operation and maintenance of the Project facilities, including adequate insurance, taxes
and special assessments. A reserve fund has been established under the provisions of the Indenture in connection with the issuance of the Bonds.
Under the provisions of the Act, and as provided in the Loan Agreement and Indenture, the Bonds are not to be payable from nor charged upon any funds other than amounts payable pursuant
to the Loan Agreement and moneys in the funds and accounts held by the Trustee which are pledged to the payment thereof; the City is not subject to any liability thereon; no owners of
the Bonds shall ever have the right to compel the exercise of the taxing power of the City to pay any of the Bonds or the interest thereon, nor to enforce payment thereof against any
property of the City; the Bonds shall not constitute a charge, lien or encumbrance, legal or equitable, upon any property of the City (other than the interest of the City in the Loan
Repayments to be made by the Company under the Loan Agreement); and each Bond issued under the Indenture shall recite that such Bond, including interest thereon, shall not constitute
or give rise to a charge against the general credit or taxing powers of the City.
Approval and Execution of Documents. The forms of the documents referred to in paragraph 2, are approved. The Loan Agreement, Indenture, Tax Regulatory Agreement and Bond Purchase
Agreement shall be executed in the name and on behalf of the City by the Mayor and the City Administrator, or executed or attested by other officers of the City, in substantially the
form on file, but with all such changes therein, not inconsistent with the Act or other law, as may be approved by the officers executing the same, which approval shall be conclusively
evidenced by the execution thereof; and then shall be delivered to the Trustee. Modifications to the forms of documents to which the City is not a party may be made at the discretion
of the parties thereto.
Approval, Execution and Delivery of Bonds. The City shall proceed forthwith to issue the Bonds, in an aggregate principal amount not to exceed $9,000,000, in the forms and upon the
terms set forth in the Indenture, which terms are for this purpose incorporated in this resolution and made a part hereof; provided, however, that the initial aggregate principal amount
of and the maturities of the Bonds, the interest rates thereon, and any provisions for the optional or mandatory redemption thereof shall all be as set forth in the final form of the
Indenture to be approved, executed and delivered by the officers of the City authorized to do so by the provisions of this Resolution, which approval shall be conclusively evidenced
by such execution and delivery. The Underwriter has agreed pursuant to the provisions of the Bond Purchase Agreement, and subject to the conditions therein set forth, to purchase the
Bonds at the purchase price set forth in the Bond Purchase Agreement, and said purchase price is hereby accepted. The Mayor, City Administrator and other City officers are authorized
and directed to prepare and execute the Bonds as prescribed in the Indenture and to deliver them to the Trustee, together with a certified copy of this Resolution and the other documents
required by the Indenture, for authentication, registration and delivery to the Underwriter. As provided in the Indenture, each Bond shall contain a recital that it is issued pursuant
to the Act, and such recital shall be conclusive evidence of the validity and regularity of the issuance thereof.
Official Statement. The City hereby approves the form of and consents to the circulation by the Underwriter of the Official Statement in offering the Bonds for sale; provided, however,
that the City has not participated in the preparation of the Official Statement or independently verified the information in the Official Statement, except under the headings "THE ISSUER"
or "LITIGATION" (insofar as it relates to the City) and takes no responsibility for, and makes no representations or warranties as to, the accuracy or completeness of such information.
Certificates, etc. The Mayor, City Administrator and other officers of the City are authorized and directed to prepare and furnish to bond counsel and the purchaser of the Bonds, when
issued, certified copies of all proceedings and records of the City relating to the Bonds, and such other affidavits and certificates as may be required to show the facts appearing from
the books and records in the officers custody and control or as otherwise known to them; and all such certified copies, certificates and affidavits, including any heretofore furnished,
shall constitute representations of the City as to the truth of all statements contained therein.
Adopted by the City Council of the City of Falcon Heights, Minnesota this 26th day of September, 2007.
Moved by: Approved by: ________________________
Susan L. Gehrz, Mayor
Sept. 26, 2007
GEHRZ In Favor Attested by: ________________________
KUETTEL Justin Miller
HARRIS Against City Administrator
LINDSTROM Sept. 26, 2007
TALBOT
STATE OF MINNESOTA
COUNTY OF RAMSEY
CITY OF FALCON HEIGHTS
I, the undersigned, being the duly qualified and acting Administrator of the City of Falcon Heights, Minnesota, DO HEREBY CERTIFY that I have compared the attached and foregoing extract
of minutes with the original thereof on file in my office, and that the same is a full, true and complete transcript of the minutes of a meeting of the City Council of said City, duly
called and held on the date therein indicated, insofar as such minutes related to a resolution approving the Kaleidoscope Charter School Project.
WITNESS my hand this 26th day of September, 2007.
Justin Miller
City Administrator